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W 2295 Chapter 6

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Marigold Limited is trying to determine the amount of its ending inventory as at August 31, the company's year end. The accountant counted everything in the warehouse in early September, which resulted in an ending inventory amount of $142,100. However, the accountant was not sure how to treat the following transactions, so she did not include them in the count. She has asked for your help in determining whether she should or should not include the following items in inventory:

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1. Aug. 15 Marigold had $1,670 of inventory isolated in the warehouse. The company isolated the goods because a customer did not want them shipped until September 6. The customer does not own the goods and will pay for them in September.

19 Marigold purchase goods FOB shipping point from a supplier. The inventory cost $1,840. The appropriate party paid the freight costs of $101. The supplier shipped the goods on August 29 and Marigold received the goods on September 2.

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Marigold purchased goods FOB destination from a supplier. The inventory cost $2,330. The appropriate

party paid the freight costs of $490. The supplier shipped the goods on August 26 and Marigold received the

goods on September 3.

Marigold was holding inventory that it sold to a customer on August 23 that needed adjustments before the

customer would take possession. The inventory cost $1,450 and the alterationscompleted on August 25,

cost $199The customer plans to pick up the inventory on September 2.

Marigold received $10,000 of inventory on consignment from Temiskaming Manufacturers Ltd. By August

31Marigold had not sold any of this inventory

Marigold shipped goods costing $4,390 FOB destination to a customerThere were no freight charges

pertaining to this shipmentThe receiving report indicates that the customer received the goods on

September 4.

Marigold shipped $8,280 of inventory on consignment to Chapleau CorporationBy August 31Chapleau

had sold 25% of this inventory for Marigold

Note

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